By Farooq Awan

Pakistan’s proposed mobile-app-based fuel quota system could reduce subsidy leakages and improve support for vulnerable users, according to the Institute of Cost and Management Accountants of Pakistan, as rising global oil prices and external pressures push the government toward more targeted fuel relief.

ICMA Pakistan said the urgency of reform has intensified amid the ongoing US-Israel-Iran conflict, which has disrupted crude flows through the Strait of Hormuz — a route that carries around 20pc of global seaborne oil trade. The report noted that the disruption has pushed Brent crude above $100 per barrel, increasing volatility in energy markets and adding pressure on fuel-importing countries such as Pakistan.

According to the report, Pakistan’s petroleum imports reached approximately $6 billion in FY2025, placing strain on foreign exchange reserves and driving up domestic fuel costs. It added that large-scale subsidy spending has constrained fiscal space for development and social programmes, making reform of the fuel subsidy framework an urgent priority.

ICMA Pakistan said the government has finalised a mobile app-based fuel quota system initially targeting motorcycles and rickshaws, with plans to extend it to small cars up to 800 cc. The report argued that blanket fuel subsidies are both fiscally unsustainable and socially inequitable, often benefiting higher-income users disproportionately.

Under the proposed system, vehicle owners would register using their CNIC and vehicle registration number through a mobile application. Users would then generate digital fuel vouchers, which petrol stations would scan or input to verify remaining quotas before dispensing subsidised fuel. Retail outlets would also use dedicated devices and separate dispensers for subsidised fuel to ensure proper segregation and accurate tracking.

The institutional framework for the system involves multiple stakeholders. The Ministry of Information Technology would operate the application, manage devices, and provide technical support, while the Ministry of Petroleum would oversee fuel supply planning and allocation. The Oil and Gas Regulatory Authority would monitor compliance, manage data, and prepare reports, while oil marketing companies would designate focal persons at the station level for operational oversight and complaint handling.

The report further noted that the Ministry of Information Technology and the National Information Technology Board plan to deploy around 24,000 mobile devices across petrol stations, with two devices per station dedicated to voucher verification.

ICMA maintained that the system has the potential to ensure that fuel subsidies reach intended beneficiaries, reduce inefficiencies, and strengthen transparency in subsidy delivery — provided implementation is supported by adequate infrastructure, verification mechanisms, and institutional coordination.

Credit: INP-WealthPk